BSkyB May Make Entry into UK Mobile Market

The UK based satellite TV broadcaster BSkyB is reported to be in talks with mobile networks about setting up its own MVNO service.

Although Sky already has an internet service provider subsidiary and owns the
Wi-Fi network, The Cloud it has no mobile telephony services. It's main UK
rival, Virgin Media already operates an MVNO of its own.

Citing banking sources, The Sunday Times reported that BSkyB is
currently in talks with Everything Everywhere, and is said to be interested in
buying a block of radio spectrum owned by the operator that it plans to sell to
participate in the forthcoming 4G spectrum auction.

Although the paper says that Sky could afford to then build its own network,
shareholders may baulk at the £3-4 billion cost and would prefer an MVNO or
shared infrastructure deal instead.

An alternative could be a trade purchase of a network. Hutchison Whampoa had
previously threatened to sell its UK subsidiary if the 4G spectrum auction
details are not favourable to the smaller operator.

BSkyB is 39%-owned by News Corporation which also owns The Sunday Times.

News Corp recently found its attempt to buy out the shareholders in BSkyB
blocked by the government and in light of ongoing political scandals about its
tabloid newspapers may find it difficult to secure regulatory permissions if it
were to make an aggressive entry into the UK mobile market.

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